Note: I am in no way affiliated with the developer of the software mentioned below, just sharing in case others find it useful.
I came across this new backup application, Parachute Backup, quite by chance recently. It’s quite a new app but already seems quite polished.
Its primary function is to create local backups of your iCloud content (including iCloud Photos), and is able to make complete backups even if you have set “optimise storage” on (whereby photos or files not recently used are offloaded to cloud to reduce local storage). Parachute Backup cleverly triggers the download of batches of offloaded files or photos, backups them up to your specified destination, and then triggers macOS to offload them again if previously offloaded.
What makes this so useful is you don’t have to have massive internal storage so you can fully download your files and photos for backup. Obviously your backup destination drive (typically an external removable drive or NAS does need to be big enough. But for those of us who can’t afford or justify the cost of a large internal SSD, you can still create full backups of your iCloud content to cheap external drives while keeping “optimise storage” on.
I’m sure others here might find this useful.